Wednesday, February 26, 2014

Will Cameron Call off the GSK Hounds?

The South China Morning Post is reporting that Britain's Serious Fraud Office plans to prosecute or fine GlaxoSmithKline for engaging in bribery in China.

For those that don't know, GlaxoSmithKline were implicated in a series of bribery allegations last year in China. The Chinese government accused British pharmaceutical giant, Glaxo of paying almost $500 million in bribes, mainly to doctors who prescribed its products.

The allegations have been played down by Glaxo chief, Andrew Witty, who last year claimed, that there are control mechanisms in place to prevent bribery and other forms of corruption, but that the methods these individuals used “would have been difficult to find using our controls.”

The allegations also claim that Glaxo reps were trained to offer sexual services to Dr's in an effort to get them to prescribe more drugs. China’s official news wire, Xinhua, last year quoted a 35-year-old female “medical representative” who reportedly worked for a GSK regional sales manager named only as Mr Li.

The woman, named as Ms Wang, said “some executives gave clear directives to the sales department to offer bribes to doctors with money or opportunities to attend academic conferences.”

Ms Wang said she would even go so far as fulfilling some doctors’ “sexual desires” in order to “meet their needs” and persuade them to prescribe more drugs.

Furthermore, it's been alleged that Glaxo reps organised all expenses paid trips for Chinese doctors to tour the scenic river town of Guilin, China's most picturesque region which has long been one of the world's most famous travel destinations.

It's also alleged that Chinese healthcare professionals were also sent to other exotic destinations such as Hungary and Greece in an effort to get them to prescribe Botox, best known for its ability to combat crow's feet and other facial wrinkles. Botox has another 26 treatable indications which include chronic migraines, uncontrollable blinking and overactive bladders, ironically, losing control of your bladder is one of the side effects associated with Botox.

It will be interesting to see how this unfolds. Personally, I don't think the British government or fraud squad will intervene. Witty is a close friend of British PM, David Cameron and his leverage to pull GSK out of the UK should persuade Cameron to call off the hounds.